Can EU Regulation Kill Mobile Gacha? Lessons from Italy’s Probe of Two AAA Mobile Franchises

Can EU Regulation Kill Mobile Gacha? Lessons from Italy’s Probe of Two AAA Mobile Franchises

Hook: If you’ve ever felt nickel-and-dimed by randomised pulls in a “free” mobile game, you’re not alone — and you’re not helpless. As regulators sharpen their focus in 2026, the mobile-gacha business model that fuels billions in annual revenue faces real legal and commercial pressure. Publishers, players and policymakers need clear-sighted analysis and practical steps now.

Top takeaway (read first)

Italy’s competition authority (the Autorita Garante della Concorrenza e del Mercato — AGCM) opened two probes in January 2026 into Activision Blizzard’s Diablo Immortal and Call of Duty: Mobile for allegedly misleading and aggressive sales practices. Unlike outright criminal gambling bans seen earlier in Belgium and the Netherlands, Italy is pursuing consumer law pathways that — if adopted by other national authorities — could force deep redesigns of gacha mechanics across the EU, reshape monetization, and accelerate global policy harmonization.

Why Italy’s probe matters beyond its borders

The AGCM’s investigation is significant for three reasons:

• Legal route: Italy framed the issue as unfair commercial practices and consumer protection — not (only) gambling — opening a toolkit of fines, injunctions and product remedies under EU consumer law.
• Target scope: The probe explicitly calls out design elements that push prolonged play and opaque virtual-currency bundles — classic “dark patterns” combined with spending nudges that exploit minors.
• Enforcement network: National consumer authorities coordinate through the EU’s Consumer Protection Cooperation (CPC) network, and precedent in one large market can trigger follow-ups in others.

“These practices ... may influence players as consumers — including minors — leading them to spend significant amounts, sometimes exceeding what is necessary to progress in the game and without being fully aware of the expenditure involved.” — AGCM press release, January 2026

How this compares to Belgium, the Netherlands and the UK

Europe’s regulatory response to loot boxes and gacha has historically split along two lines: criminal-law-style gambling interpretations (Belgium, Netherlands) and consumer-protection or regulatory guidance approaches (UK and other jurisdictions).

Belgium — the early hard line

In 2018 Belgian authorities concluded that certain loot boxes met the legal definition of gambling because they involved monetary stakes with randomized rewards that could be monetized or exchanged. That decision forced several publishers to remove or alter randomized mechanics for Belgian users. The Belgian approach demonstrated that a national determination can have immediate product changes, but it’s limited by the narrow legal test for gambling — not all gacha falls cleanly into that bucket.

Netherlands — nuanced enforcement

The Dutch regulator has taken targeted actions against specific implementations it judged to meet gambling statutes, while also pushing publishers to increase transparency and odds disclosure. The Netherlands’ experience shows regulators can combine criminal-law risk with administrative pressure to change product features.

United Kingdom — consumer protection over criminalisation

The UK’s official line during the early 2020s leaned toward consumer protection: loot boxes were generally not “gambling” if players couldn’t cash out to real money, but the sector needed stricter transparency, age checks, and parental controls. UK parliamentary committees and consumer bodies recommended reforms rather than sweeping bans — a playbook now echoed in Italy’s consumer-law framing.

Legal avenues and mechanisms the EU (and member states) can use

The AGCM’s choice to use consumer-law instruments matters because it unlocks a different enforcement path with faster, broader remedies. Key legal instruments and regimes in play include:

• Unfair Commercial Practices Directive (UCPD) — Under EU rules, misleading omissions or aggressive practices that distort consumer choices can be banned. Design elements that hide real costs or weaponize urgency may be framed as UCPD violations.
• National consumer protection laws — Member states can fine and order corrective measures under local law; decisions can be shared via the CPC network for cross-border coordination.
• Data and profiling rules — GDPR and ePrivacy can limit behavioural targeting (especially of minors). Personalized monetization nudges derived from profiling are now an enforcement focus in a post-2024 regulatory climate.
• Digital Services Act (DSA) and transparency obligations — Platforms and large online players must disclose recommender system logic and advertising practices; these transparency obligations can pressure the discoverability and nudging mechanics used in gacha systems.

Possible ripple-effect scenarios

Let’s map plausible near-term outcomes and what each would mean for players and the industry.

Scenario A — Guidance and voluntary fixes (soft pivot)

Regulators issue guidance; publishers update odds disclosure, strengthen parental controls, and tweak bundles. Revenues fall modestly as high-spending friction increases, but the core gacha model survives with cleaner optics.

Scenario B — Consumer-law enforcement and targeted bans

Authorities impose fines and order the removal of specific mechanics deemed misleading or aggressive. Developers need to rework progression gating and virtual-currency bundling. This is disruptive for high-spend monetization but still allows deterministic purchases and cosmetics.

Scenario C — Functional restriction of randomized-pay-to-progress

If multiple member states follow Italy’s consumer-protection approach at scale, the commercial viability of randomized pay-to-progress mechanics (classic gacha) could collapse in the EU market. Publishers may either withdraw games, offer alternative pay models, or build geo-blocking workarounds. This would be the closest outcome to a de facto EU-wide “gacha cap.”

Industry impact — what publishers and developers should expect

From an economic perspective, mobile gacha accounts for a disproportionate share of AAA mobile revenue. Here’s how firms may adapt.

• Short-term revenue hit: Odds disclosure, pack restructuring, and spending ceilings will depress whales’ spending temporarily.
• Product redesign: Migration to explicit pricing, battle passes, subscriptions, and cosmetic-only monetization that removes pay-to-progress randomness.
• Operational costs: Increased compliance budgets (legal, product, age verification), potential fines, and overhead for regional product versions.
• Reputational evolution: Brands that proactively reform may gain competitive advantage as trust becomes a selling point.

Real-world lessons from past shifts

When Belgium’s stance forced publishers to remove contested loot boxes, developers pivoted: some created deterministic purchase options or region-specific SKU changes. The market adjusted — but often conservatively, favouring simpler transparency changes rather than wholesale revamps. That playbook may not hold if Italy’s consumer-law strategy becomes the norm across several large EU markets.

Practical, actionable advice

Below are concrete steps for the three groups most affected: publishers/developers, policymakers/regulators, and players/parents.

For publishers and developers

• Audit your funnels: Immediately map where game design nudges spending (event timers, drop rates that gate progression, bundle opacity). Document everything for compliance reviews.
• Disclose odds and costs: Make drop rates and exact cost-to-progression explicit in store listings and in-game carts. Odds disclosure is low-hanging fruit that reduces regulatory heat.
• Stop dark patterns: Remove misleading countdowns, artificially scarce offers that reset on relaunch, and UI tricks that hide currency value.
• Introduce alternative monetization: Offer non-random premium paths (season passes, direct purchase of progression items, subscriptions) and test their revenue lift vs churn risk.
• Invest in age verification: Build or buy robust verifiable-age solutions and limit targeted offers to minors. Expect regulators to view this as a baseline requirement.
• Legal-first product design: Embed compliance in design sprints. Use consumer-law and data-privacy counsel early, not after launch.

For policymakers and regulators

• Harmonize definitions: Distinguish randomized “pay-to-progress” from cosmetic RNG and clarify what constitutes “aggressive” design.
• Adopt harm-based metrics: Monitor spending patterns, prevalence of minors among high spenders, and time-to-purchase triggers rather than making bright-line rules alone.
• Create sandboxes: Allow industry testing under supervision to find commercially viable, less-harmful monetization models.
• Coordinate internationally: Use the CPC network and EU-level guidance to avoid patchwork market fragmentation that incentivizes geo-targeting workarounds.

For players and parents

• Understand virtual currency: Treat in-game currency bundles like gift cards — calculate your real-money-per-virtual-unit before buying.
• Use platform controls: Enable purchase authentication, set spending limits, and keep payment methods off kids’ devices.
• Document issues: If you suspect misleading practices, capture screenshots and report to consumer authorities — regulatory action often begins with consumer complaints.

2026 trends to watch

Several patterns that crystallised in late 2024–2025 are accelerating in 2026 and will determine whether gacha survives in recognizable form:

• Coordinated enforcement: National consumer authorities are sharing playbooks on dark patterns and microtransactions. Expect joint inquiries and faster case law creation.
• AI-driven personalization scrutiny: Regulators are focused on how AI accelerates targeting of high-value spenders (including minors). Personalized gacha offers that adapt to a player’s spending history are now a red flag.
• Platform liability and app-store rules: Apple and Google have already updated store policies around in-app purchases; platform gatekeepers may add stricter rules for randomized monetization under DSA-like expectations.
• Market-driven alternatives: Early movers shifting to transparent subscription or buy-to-own models have seen loyalty improvements in pilot programs across 2025.

Risk matrix: What happens if Italy’s approach scales?

If multiple major EU markets replicate Italy’s consumer-law approach, expect:

• Immediate: Rewrites of store descriptions, odds disclosure, and temporary revenue decline in fined titles.
• 6–12 months: Product rebalances away from randomized pay-to-progress and toward deterministic monetization. Some publishers will geo-block or pull games pending redesign.
• 2 years: A new normal emerges: clearer pricing, stronger parental controls, and fewer high-stakes randomized progression systems in EU versions of mobile titles. Global publishers will either adapt globally or maintain divergent regional builds.

Final verdict — is gacha doomed?

Not necessarily. Gacha as a mechanic isn’t intrinsically unlawful — but the business models built around exploitative design are vulnerable. The AGCM probe demonstrates a pragmatic regulatory pivot: use consumer law to target the business logic that harms consumers rather than relying solely on the narrow criminal definition of gambling.

Publishers who move early — simplifying offers, disclosing value, and removing predatory nudges — can preserve commercial viability while reducing regulatory risk. Those who delay face fines, market loss and reputational damage.

What to do next (for readers)

If you play mobile games: check purchase settings, document questionable practices, and report them to your national consumer authority. If you work in games: start an immediate compliance audit and pilot deterministic monetization experiments. If you are a policymaker: prioritise cross-border coordination and harm-based rules that protect minors and vulnerable consumers without killing creativity.

Call to action: We’ll track the AGCM case and broader EU reactions — subscribe to our newsletter for weekly updates, share your experiences with in-game purchases, and let regulators hear from real players. The future of mobile gacha will be decided by policy, market forces and public pressure — make your voice count.

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